2019.09.30 07:14Nation



2019.09.30 07:14Nation

Abe to Raise Consumption Tax for 2nd Time after Delays

Japanese Prime Minister Shinzo Abe will raise the consumption tax for the second time on Tuesday, after delaying implementing the increase twice after the previous 2014 hike weighed heavily on personal consumption.
   In April 2014, Abe increased the tax from 5 pct to 8 pct under an agreement reached in 2012 among the then ruling Democratic Party of Japan, his Liberal Democratic Party and the LDP's partner, Komeito. But the hike undermined consumption more than expected, making Abe cautious about raising the tax further to 10 pct.
   Based on opinions from experts and economic data, Abe in November 2014 announced a decision to postpone the tax increase to 10 pct to April 2017 from the initially planned October 2015. At the time, he said there would be no more delay and his ruling bloc won a general election called following the decision.
   But personal consumption remained sluggish. At the May 2016 summit of Group of Seven leaders in Japan, Abe said the global economy was facing a situation similar to what was witnessed just before the global financial crisis happened in 2008.
   In June 2016, he postponed the tax increase again, to October 2019. Defending himself from criticism that he failed to deliver on his 2014 pledge not to delay the increase again, the prime minister said he made "a new decision that is different from what I have pledged until now."